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NOW. NEXT. NEW. for CT Manufacturers with COHNREZNICK

Hosted by Connecticut Center for Advanced Technology, Inc. (CCAT) & Advanced Manufacturing Employer Partnership (AMEP)

April 30, 2020

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Agenda

• Opening Remarks (Ron Angelo, CCAT President & CEO)

• Made in America Perspectives (Ari Santiago)

• Now, Next, New (COHNREZNICK)

• Federal Updates (McAllister & Quinn)

• CT Manufacturers (Colin Cooper)

• Manufacturers’ Perspectives• AMEP Co-Chairs: Glenn Ford & Charles Daniels

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Presenters• Ron Angelo, CCAT President & CEO

• AMEP Co-Chairs

– Hartford-Area: Glenn Ford, President, Phoenix Manufacturing

– Central CT: Charles Daniels, Chief Financial Officer, Wepco Plastics

• Colin Cooper, CT Chief Manufacturing Officer

• Ari Santiago, President, IT Direct

• McAllister & Quinn

– Chris Fish, Vice President

– Jake Parduhn, Director of Federal Affairs

• COHN REZNICK

– Jeffrey W. Rossi, Managing Partner

– Cynthia Romano, Global Director

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Join me weekly for the podcast!

Podcast website: http://madeinamericawithari.com/

YouTube channel: https://www.youtube.com/user/itdirect151

Or Search for Made in America with Ari Santiago on your favorite podcast app!

Connect with me on LinkedIn for more great content for CT manufacturers:https://www.linkedin.com/in/asantiago104/

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NOW, NEXT, NEW

FOR CONNECTICUT

MANUFACTURERS

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TODAY’S SPEAKERS

Jeffrey Rossi

Office Managing Partner, Connecticut Offices

Manufacturing and Distribution Industry, Co-Leader

CohnReznick LLP

Cynthia Romano

Global Director

Restructuring & Dispute Resolution

CohnReznick LLP

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PULL THE RIGHT LEVERS TO EXTEND LIQUIDITY

ASSESS THE IMPACT OF STRESSORS ON

THE BUSINESS

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THANK YOU

Jeffrey Rossi

Office Managing Partner, Connecticut Offices

Manufacturing and Distribution Industry, Co-Leader

CohnReznick LLP

Cynthia Romano

Global Director

Restructuring & Dispute Resolution

CohnReznick LLP

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SBA Loan Programs Recap

• SBA is providing small business economic relief primarily through two loan programs – Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan Program (EIDL).– For detailed information each loan program, including a recording of CCAT’s two

prior webinars, copies of slides, and FAQs, please visit: https://www.ccat.us/2020/04/helping-ct-manufacturers-webinar/

• SBA loan activity in CT after first tranche of funding ($350B)– CT PPP Loans to Date: 18,500 loans approved for $4.2 billion; Avg. loan size

$225K

– CT EIDL Loans to Date: 696 loans approved for $143 million; Avg. loan size $205K

• Interim Economic Stimulus Funding Package signed into law Friday last week (4/24).– Additional $310 billion for PPP ($60 billion set-aside for smaller lenders).

– Additional $60 billion for EIDL loans and grants.

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SBA Loan Programs Update

• SBA has begun distributing funds and processing loans for both the PPP and EIDL programs again. Expect funds to run out quickly! SBA used first tranche of funds in 13 days. Expect funds to run out faster in the second round.

• New Applications: Backlog of hundreds of thousands of applications from the first round of funding, either waiting to be processed or waiting to receive funds. EIDL program is not accepting new applications at this time, web application portal closed. Most of the PPP funds will go towards funding PPP applications already in the queue. First come, first served.

• Since the “Interim Economic Stimulus Funding Package” was signed into law last Friday, the Department of Treasury and SBA issued additional guidance and clarifications.

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Treasury-SBA Additional Guidance/Clarification

• Companies "owned by large companies with adequate sources of liquidity to support the business’s ongoing operations" are discouraged from receiving SBA Loans.– Though some can be technically eligible, must certify in good faith that their PPP

loan request is necessary.

• Private Equity firms are ineligible to receive SBA loans. The SBA affiliation rules apply to private equity-owned businesses in the same way as any other business.– Affiliation based on ownership; Affiliation arising under stock options, convertible

securities, and agreements to merge; Affiliation based on management; Affiliation based on identity of interest

– For full review of SBA Affiliation Rules, including exemptions, please consult the following link: Click Here

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Treasury-SBA Additional Guidance/Clarification

• Clarification on determining employee count for eligibility threshold –part-time and full-time employees are included. 1099 independent contractors not included. By contrast, for loan forgiveness, the standard of “fulltime equivalent employees” is used to determine the loan forgiveness amount in the event of workforce reductions.

• If you’re currently involved in bankruptcy proceedings, will generally make you ineligible for PPP loans.

• SBA rolled out a new E-Tran system and process for second round of funding.

– Still hearing of significant glitches and issues.

• SBA had informed banks that it would limit the number of PPP applications they can submit per hour, in order to allow all banks (smaller banks) access to the program.

– Small banks were crowded out in the first round of funding.

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SBA Loan Programs Moving Forward

• We expect the SBA Loan Programs to be replenished with a third round of funding through the 4th Economic Stimulus Package.

– Expecting Congress to consider next funding package later in May.

• For New EIDL applications – must wait until new funding arrives and application portal is open.

• For PPP applications – if you haven’t applied, prepare your application/documentation and continue conversations with a qualified lender. Might not receive funding until loan programs are replenished.

• If your application has been processed, but funding hasn’t arrived, you are in the queue.

– Issues with EIDL/PPP, contact SBA 24/7 Helpline: 800-659-2955

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New Program: Federal Reserve’s Main Street Lending Program

• On April 9th, Federal Reserve released details on plans to make $600 billion in loans available through its Main Street Lending Program.

• Would provide loans to a broader range of entities – small businesses and business up to 10,000 employees or $2.5 billion in 2019 revenue

• Main Street New Loan Facility (MSNLF) will provide newly originated loans to eligible businesses and the Main Street Expanded Loan Facility (MSELF), will allow companies to increase existing loans. Several loan conditions involved.

• Information on timing and other details about the application processes have not yet been released. Terms of the program are subject to change.

• Federal Reserve has been meeting this week to discuss and finalize the parameters of the program.

• We expect this program to be available by Mid-May.

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Main Street Lending Program - Next Steps

Review initial programmatic details: For the initial details of the Main Street Lending Program, including a recording of last week’s webinar and a copy of slides, please visit: https://www.ccat.us/2020/04/federal-reserve-loans-webinar/

Review additional guidance: The Federal Reserve will be issuing additional guidance to potential borrowers and lenders with details on how to access funding. This will be a future webinar topic – more details to come.

Evaluate your options and reach out to your current lender(s): Contact your lender to discuss this upcoming program, your company’s financial position, potential funding needs, current debt obligations, and which program might be the best fit. Review any current arrangements that may limit participation.

Similar to PPP and EIDL programs, this program will be first come, first served.

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State Re-opening Regional Council - Engaged on a Regional Basis

Reopen CT Advisory Group- Main Advisory Committee - Business Committee- Community Committee- Education Committee

Phased Opening- Phase 1 – Main Street- Phase 2 – Lodging- Phase 3 – Larger Venues

Timing- Informed by data - Trends are good, not great- Better Trends will allow for acceleration of the re-opening

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Employer’s Perspectives

Charles Daniels, CFO, Wepco Plastics

Glenn Ford, President Phoenix Manufacturing

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Staying Focused Checklist by EOSHighlights below, complete checklist at

https://www.eosworldwide.com/blog/staying-focused-checklist

1. Your team needs 5 things from you- Calm, Communication, Connection, Clarity and Confidence.

2. Don’t cancel weekly and quarterly meetings.3. Communicate frequently, proactively with customers, partners

and vendors.4. Update technology, systems and processes to improve

efficiency5. Look for opportunity. Don’t stop marketing or selling.6. Obsess about data.

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Stay the Course! Establishing a Relative Feeling of Normalcy

- Maintain your ‘Regular Meeting’ frequency- Make social distancing interesting- Be seen and heard on the gemba- Create the ‘new normal’ slow and steady- Remove financial concerns

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• Additive Manufacturing

• Composites Manufacturing

Services available at our Advanced Manufacturing Center

Contact us today to talk about your challenges and how we can help you succeed.

infoamc@ccat.us | 860.610.0478

• Precision Machining

• Technology Workshops

• Inspection Technologies/Reverse Engineering

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• Introduction to Design to Print Technology - Thursday, May 7 | 10 AM

Attend These Virtual Workshops - On Demand Any Time

• Intro to Data Dashboards and Applied Artificial Intelligence

• Intro to Predictive Maintenance Technologies

• Intro to Internet of Things/Cloud Computing and Cognitive Computing

• Modernization – Strategies for Implementing New Technology in Manufacturing

• Introduction to High Speed Contact Metrology

ccat.us/incumbent-worker-training/

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VIRTUAL RESOURCESctdidi.com/resources/

What’s So Cool About Manufacturing?

Explore student-created videos featuring CT

manufacturing companies.

Cool Stuff Made In CTStart your journey to a career in manufacturing. Learn about

CT-made products and who makes them.

Augmented Reality Smart MFG Comic Book & App

Use augmented reality to design, manufacture, and

test a flying drone!

TOOLS & RESOURCES FOR EDUCATIONAL & CAREER PATHWAYS

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• Each Thursday @ 12pm

• Next Webinar 5/7

By CT Manufacturers for CT Manufacturers

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Follow-UpSlides have been posted on the CCAT website: ccat.us/events/now-next-new-for-ct-manufacturers-with-cohnreznick/

• Frequently Asked Questions (FAQs) & Answers will be periodically updated and posted on this site as additional information surfaces.

• CCAT Point of Contact:

Lynn Raicik, Associate Director, Workforce Pipeline Programs lraicik@ccat.us, (860) 982-6637

• For questions or suggested topics for upcoming webinars, email: workforce@ccat.us

This information is provided for general informational purposes only and should not be relied on by any party for any reason. All liability with respect to actions taken or not taken based on the information provided are hereby expressly disclaimed. The information is provided “as is” and no representations are made that the information is “error free”. We reserve the right to change or delete any information contained herein at any time without notice.